704B.360 Additional analysis of 10-percent
contract; meetings and discussions; determination of best interest by
Commission; consequences of determination.

704B.370 Duty to file and serve certain
agreements; limited review and use of certain underlying contracts;
confidentiality; terms, conditions and compliance items; petition to reopen
consideration of application; limitations on actions of Commission after
approval of application.

704B.380 Proposed transaction between
eligible customer and provider which relies exclusively on new electric
resources currently in operation.

704B.385 Proposed transaction between
eligible customer and provider which relies on new electric resources that will
be constructed after application granted by Commission.

NAC 704B.010Definitions. (NRS 704B.200)As used
in this chapter, unless the context otherwise requires, the words and terms
defined in NAC 704B.020 to 704B.145,
inclusive, have the meanings ascribed to them in those sections.

(Added to NAC by Pub. Utilities Comm’n by R125-01, eff.
12-17-2001; A by R018-04, 11-17-2005)

NAC 704B.020“Ancillary services” defined. (NRS 704B.200)“Ancillary
services” has the meaning ascribed to it in NRS 704B.020.

(Added to NAC by Pub. Utilities Comm’n by R125-01, eff.
12-17-2001)

NAC 704B.024“Application” defined. (NRS 704B.200)“Application”
means an application filed pursuant to this chapter and chapter 704B of NRS for approval from
the Commission to purchase energy, capacity or ancillary services from a
provider of new electric resources.

(Added to NAC by Pub. Utilities Comm’n by R125-01, eff.
12-17-2001)

NAC 704B.028“Bureau of Consumer Protection” defined. (NRS 704B.200)“Bureau
of Consumer Protection” means the Bureau of Consumer Protection in the Office
of the Attorney General.

NAC 704B.044“Date of commencement” defined. (NRS 704B.200)“Date of
commencement” means the date on which an eligible customer begins or intends to
begin purchasing energy, capacity or ancillary services from a provider of new
electric resources pursuant to a proposed transaction.

(Added to NAC by Pub. Utilities Comm’n by R125-01, eff.
12-17-2001)

NAC 704B.050“Electric utility” defined. (NRS 704B.200)“Electric
utility” has the meaning ascribed to it in NRS 704B.050.

NAC 704B.094“Existing eligible customer” defined. (NRS 704B.200)“Existing
eligible customer” means an eligible customer in the service territory of an
electric utility that is purchasing energy, capacity or ancillary services from
the electric utility or a provider of new electric resources.

(Added to NAC by Pub. Utilities Comm’n by R125-01, eff.
12-17-2001)

NAC 704B.098“FERC” defined. (NRS 704B.200)“FERC”
means the Federal Energy Regulatory Commission of the United States Department
of Energy.

(Added to NAC by Pub. Utilities Comm’n by R125-01, eff.
12-17-2001)

NAC 704B.100“Impact fee” defined. (NRS 704B.200)“Impact
fee” means an amount assessed by the Commission against an eligible customer
pursuant to subsection 7 of NRS
704B.310, but does not include any payment required by subparagraph (2) of
paragraph (b) of subsection 7 of NRS
704B.310.

(Added to NAC by Pub. Utilities Comm’n by R018-04, eff.
11-17-2005)

NAC 704B.104“Letter of intent” defined. (NRS 704B.200)“Letter
of intent” means a letter of intent that an eligible customer submits pursuant
to NAC 704B.320.

NAC 704B.140“Time-of-use meter” defined. (NRS 704B.200)“Time-of-use
meter” has the meaning ascribed to it in NRS 704B.140.

(Added to NAC by Pub. Utilities Comm’n by R125-01, eff.
12-17-2001)

NAC 704B.145“Underlying contract” defined. (NRS 704B.200)“Underlying
contract” means a contract or proposed contract between an eligible customer
and a provider of new electric resources that is the subject of an application
filed pursuant to NRS 704B.310.

(Added to NAC by Pub. Utilities Comm’n by R018-04, eff.
11-17-2005)

NAC 704B.170Effect
of chapter on certain existing contracts. (NRS 704B.170, 704B.200)The
provisions of this chapter do not alter in any manner the terms and conditions
of any existing contract between an eligible customer and an electric utility.

(Added to NAC by Pub. Utilities Comm’n by R125-01, eff.
12-17-2001)

NAC 704B.175Deviation from provisions of chapter. (NRS 704B.200)The
Commission may allow deviation from the provisions of this chapter if:

1. Good cause for the deviation appears; and

2. The Commission finds the deviation to be
in the public interest and not contrary to statute.

(Added to NAC by Pub. Utilities Comm’n by R018-04, eff.
11-17-2005)

TRANSACTIONS WITH ELIGIBLE CUSTOMERS

NAC 704B.300Criteria for determining whether end-use customer has average
annual load of 1 megawatt or more; each service location of certain entities
treated as separate end-use customer. (NRS 704B.200)

1. If an end-use customer is a new end-use
customer or has been an end-use customer for less than 12 months in the service
territory of an electric utility, the Commission will consider the end-use
customer to have an average annual load of 1 megawatt or more in the service
territory of the electric utility only if the Commission determines the end-use
customer will consume, during the 12 months immediately following the date of
commencement, 8,760,000 kilowatt-hours or more of energy in the service
territory of the electric utility.

2. For all other end-use customers in the
service territory of the electric utility, the Commission will consider the
end-use customer to have an average annual load of 1 megawatt or more in the
service territory of the electric utility only if the end-use customer has
consumed, during the most recent 12-month period, 8,760,000 kilowatt-hours or
more of energy in the service territory of an electric utility.

3. The Commission will treat each service
location of a nongovernmental commercial or industrial entity as a separate
end-use customer.

4. As used in this section, “service
location” means:

(a) A single point of delivery;

(b) Multiple points of delivery on contiguous
property; or

(c) Multiple points of delivery that, as of the
date on which the application is filed, have been treated as a single service
location by the electric utility.

1. An eligible customer may not file an
application unless the eligible customer complies with all applicable
provisions of this chapter and chapter
704B of NRS.

2. Multiple eligible customers within a
single service territory may file a single application. If such an application
is filed, each eligible customer named as an applicant must comply with all
applicable provisions of this chapter and chapter
704B of NRS.

3. If an application is filed:

(a) Each eligible customer named as an applicant,
each provider named in the application, the electric utility and the Bureau of
Consumer Protection shall be deemed to have a direct and substantial interest
in the proceedings on the application; and

(b) No other person or entity shall be presumed to
have a direct and substantial interest in the proceedings on the application.

(Added to NAC by Pub. Utilities Comm’n by R125-01, eff.
12-17-2001; A by R018-04, 11-17-2005)

NAC 704B.320Letter of intent to file application: General requirements;
contents; limitations on use of certain information by electric utility. (NRS 704B.200)

1. Not later than 30 calendar days before
the date on which an eligible customer files an application, the eligible
customer shall submit a letter of intent to file the application to:

(a) The electric utility that is serving the
eligible customer;

(b) The Regulatory Operations Staff; and

(c) The Bureau of Consumer Protection.

2. The letter of intent submitted pursuant
to this section must include the following information:

(a) The name of the eligible customer, the address
and other contact information for the eligible customer, and information
demonstrating that the applicant is an eligible customer.

(b) The name of the provider, the address and other
contact information for the provider, and information demonstrating that the
provider will provide energy, capacity or ancillary services from one or more
identifiable new electric resources, including the location of the new electric
resource or identification of the market for the new electric resource. If the
provider intends to build a new electric resource, the letter of intent must
also include a description of the proposed new facility and of how the total
electricity requirements of the eligible customer will be met.

(c) Each point of delivery at which the eligible
customer intends to purchase energy from the provider and, for each such point
of delivery:

(1) The physical location of the point of
delivery; and

(2) The current account number for the point
of delivery, the name on each such account and the current billing address and
final billing address for each such account.

(d) A description of the proposed transaction in
the executed underlying contract between the provider and the eligible customer
or, if no executed underlying contract exists when the letter of intent is
submitted, a description of the terms that the eligible customer reasonably
expects to be included in an executed underlying contract between the eligible
customer and the provider for the purchase of energy, capacity or ancillary
services from the provider. The description must include:

(1) The date of commencement and the duration
of the proposed transaction;

(2) The amount of energy, capacity and
ancillary services, if any, to be purchased by the eligible customer;

(3) The identity of any scheduling coordinator
as required by the OATT of the electric utility to be used by the eligible
customer in scheduling the delivery of energy to the eligible customer and
written confirmation from the scheduling coordinator;

(4) The point or points of receipt;

(5) The maximum number of megawatts or
megawatt-hours to be delivered under the proposed transaction and any load
forecasts developed to determine the maximum number of megawatts or
megawatt-hours to be delivered under the proposed transaction;

(6) Information regarding the nature of the product
being purchased, including, without limitation, information regarding whether
the energy or capacity is firm;

(8) Information regarding load ramps, both
increases and decreases, over the term of the proposed transaction.

(e) Information specifying which ancillary services
will be taken from which entities.

(f) Information indicating whether the new electric
resources will be delivered from within or outside of the control area of the
electric utility.

3. In addition to the information required
by subsection 2, if an eligible customer is a governmental entity, the eligible
customer shall include with the letter of intent information sufficient to
establish that:

(a) The eligible customer is a governmental entity;
and

(b) The facilities and other locations that will be
served by the provider are operated by the eligible customer under a common
budget and common control.

4. The electric utility may use information
regarding submission of the letter of intent, information included with the
letter of intent or information otherwise provided in connection with a
proposed transaction governed by this chapter only for the performance of
analyses required by this chapter, and the electric utility shall not use such
information when conducting its sales or marketing activities. An electric
utility shall adhere to the written standards, policies and procedures filed by
the electric utility with the Commission to ensure compliance with this
subsection.

1. Approximately 15 calendar days before the
date on which an eligible customer files an application, the eligible customer,
the electric utility and the Regulatory Operations Staff shall meet, in person
or telephonically, to discuss the information included with the letter of
intent and to identify any issues of concern with respect to the proposed
transaction. Not later than 5 working days before the date of the meeting, the
Bureau of Consumer Protection must be notified of the meeting, and the Bureau
of Consumer Protection may participate fully in the meeting.

2. The provisions of this section do not
preclude the eligible customer, the electric utility, the Regulatory Operations
Staff or the Bureau of Consumer Protection from meeting or conferring as often
as they deem necessary to accomplish the objectives of this section.

3. The Regulatory Operations Staff shall
identify any additional data and information that it will need from the
electric utility and the eligible customer to carry out the provisions of this
section and the format that the electric utility and the eligible customer must
use to provide and update the data and information. The electric utility and
the eligible customer shall provide and update the data and information in such
manner and at such times as the Regulatory Operations Staff may request.

1. If an eligible customer files an
application, the eligible customer shall include with the application all the
information that the eligible customer included with the letter of intent and
all the following items:

(a) Information demonstrating that the eligible
customer or the provider has the ability to enter into all transmission service
agreements necessary for the provider to deliver energy to the distribution
system of the electric utility, and the proposed rates, terms and conditions of
each such agreement. The eligible customer shall be deemed to have met the
requirements of this subsection if:

(1) The eligible customer or the provider
demonstrates that transmission service agreements with the electric utility
will not be necessary for the provider to deliver energy to the distribution
system of the electric utility; or

(2) The eligible customer demonstrates that it
is an eligible customer under the OATT of the electric utility and the eligible
customer agrees, to the extent applicable, to pay all costs for system impact
studies, costs for construction and other costs required under the OATT of the
electric utility to obtain the necessary transmission service.

(b) Information demonstrating that all energy
delivered to the eligible customer will be metered through one or more
time-of-use meters for each point of delivery.

(c) Any applicable system impact studies or
facilities studies completed for the transmission service request.

(d) Any information required to update or complete
the information the eligible customer included with the letter of intent.

(e) Any other information deemed necessary by the
Regulatory Operations Staff and requested in writing.

(f) If the eligible customer is a nongovernmental
commercial or industrial end-use customer whose load is in the service
territory of an electric utility that primarily serves densely populated
counties:

(1) Information demonstrating that the
eligible customer has obtained the 10-percent contract in accordance with
subsection 2 of NRS 704B.320;

(2) A binding offer, in the form of a separate
contract, to assign the 10-percent contract to the electric utility; and

(3) All the information reasonably foreseen to
be necessary to enable the Regulatory Operations Staff or any party of record
to perform an analysis of the 10-percent contract.

2. The eligible customer may request from
the Commission a protective order to protect the confidentiality of any
information the eligible customer believes to be commercially sensitive. The
Commission will determine whether the requested information is commercially
sensitive under Nevada law and requires confidential treatment. If the
Commission determines that the information is commercially sensitive, the
Commission:

(a) Will grant a protective order at least with
respect to all information concerning the price of the energy, capacity and
ancillary services to be purchased by the eligible customer.

(b) Will grant a protective order with respect to
all information concerning the price of the energy, capacity and ancillary
services associated with the 10-percent contract offered by the eligible
customer pursuant to subsection 2 of NRS 704B.320.

(c) Will not grant a protective order with respect
to the information described in paragraphs (a) and (b) of subsection 2 of NAC 704B.320.

3. If information is protected by a
protective order, the Regulatory Operations Staff, the Bureau of Consumer
Protection, the electric utility and any intervener authorized by the
Commission to participate in the matter pursuant to NAC 703.578 to 703.600, inclusive, may have access to
such information upon execution of a confidentiality agreement and subject to
the terms of the protective order and the confidentiality agreement. Information
protected by a protective order must not be disclosed on the public record or
otherwise in any proceeding governed by this chapter, except as provided in the
protective order.

1. Not later than 45 calendar days after the
date on which the eligible customer files an application, the Regulatory
Operations Staff shall:

(a) Perform its initial analysis of the proposed
underlying contract to estimate the potential impacts of the proposed
underlying contract on the electric utility and its remaining customers; and

(b) Release the results of its initial analysis to
the eligible customer, the provider, the electric utility and the Bureau of
Consumer Protection.

2. Not later than 55 calendar days after the
date on which the eligible customer files an application, the Regulatory
Operations Staff, the eligible customer and the electric utility shall meet, in
person or telephonically, at least once to discuss the results of the initial
analysis performed by the Regulatory Operations Staff and, if necessary, to
exchange information, including, without limitation, the exchange of any
suggested additions, modifications or deletions to the initial analysis
performed by the Regulatory Operations Staff. The Bureau of Consumer Protection
and the provider must be notified of each such meeting, and each may
participate fully in each such meeting and in any exchange of information.

3. Not later than 65 calendar days after the
date on which the eligible customer files an application, the Regulatory
Operations Staff shall:

(a) Finalize its analysis of the proposed
underlying contract. In finalizing its analysis, the Regulatory Operations
Staff shall incorporate any information obtained from the eligible customer,
the provider, the electric utility and the Bureau of Consumer Protection that
the Regulatory Operations Staff determines will most accurately estimate the
potential impacts of the proposed underlying contract.

(b) Release the results of its finalized analysis
to the eligible customer, the provider, the electric utility and the Bureau of
Consumer Protection.

(c) Submit its finalized analysis to the
Commission.

4. Not later than 80 calendar days after the
date on which the eligible customer files an application, any party of record
may file with the Commission an alternative analysis to the analysis performed
by the Regulatory Operations Staff. Each alternative analysis must:

(a) Identify the bases for concluding that the analysis
performed by the Regulatory Operations Staff is deficient; and

(b) Include objective information demonstrating
that the methodology used by the party is valid under the range of
circumstances included in the alternative analysis performed by the party.

5. The provisions of this section do not
preclude the Regulatory Operations Staff, the eligible customer, the provider,
the electric utility or the Bureau of Consumer Protection from meeting or
conferring as often as they deem necessary to accomplish the objectives of this
section.

6. The Regulatory Operations Staff shall
identify the data and information that it will need from the electric utility
and the eligible customer to carry out the provisions of this section and the
format that the electric utility and the eligible customer must use to provide
and update the data and information. The electric utility and the eligible
customer shall provide and update the data and information in such manner and
at such times as the Regulatory Operations Staff may request.

7. The Regulatory Operations Staff shall
provide the Commission and other interested parties with a detailed description
of the methodology that it will use to estimate the potential impacts of the
proposed underlying contract on the electric utility and its remaining
customers. The description must include, without limitation:

(a) The methodology for analyzing net costs or
benefits to the electric utility and its remaining customers and for ensuring
that there are no net negative impacts to the electric utility and its
remaining customers. The description must identify the commercial model or
algorithm for the methodology and must contain a narrative description of that
commercial model or algorithm.

(b) The assumptions to be used with the
methodology, including, without limitation, the time frame for analyzing net
costs or benefits to the electric utility and its remaining customers and the
categories of costs to be used with the methodology.

(c) The sources of information to be used with each
category of costs identified in paragraph (b), including, without limitation,
sources of information regarding:

(1) Capacity and energy, including energy from
renewable resources;

(2) Transmission;

(3) Distribution; and

(4) Natural gas commodity and capacity.

(d) Other external inputs necessary for the
operation of the commercial model or algorithm identified in paragraph (a).

(e) Any data and information obtained from the
electric utility, including any updated data and information.

8. The Regulatory Operations Staff shall
provide the Commission and other interested parties with a detailed description
of the information that must accompany any request by a third party to perform
an independent analysis of the potential impacts of the proposed underlying contract
on the electric utility and its remaining customers. The description must
include, without limitation, the cost, if any, to perform such an independent
analysis.

(Added to NAC by Pub. Utilities Comm’n by R125-01, eff.
12-17-2001; A by R018-04, 11-17-2005)

1. In addition to the requirements of NAC 704B.350, if the eligible customer is a
nongovernmental commercial or industrial end-use customer whose load is in the
service territory of an electric utility that primarily serves densely
populated counties, not later than 15 calendar days after the date on which the
eligible customer files a completed and fully executed underlying contract
between the eligible customer and provider, the Regulatory Operations Staff
shall:

(a) Perform its initial analysis of the 10-percent
contract identified in the application pursuant to paragraph (f) of subsection
1 of NAC 704B.340. In its initial analysis, the
Regulatory Operations Staff shall indicate whether the 10-percent contract will
be beneficial or detrimental to the remaining customers of the electric utility
and shall include a recommendation regarding whether the 10-percent contract
should be assigned to the electric utility.

(b) Provide its initial analysis to the eligible
customer, the provider, the Bureau of Consumer Protection and the electric
utility.

2. Not later than 20 calendar days after the
date on which the eligible customer files the completed and fully executed underlying
contract, the Regulatory Operations Staff, the eligible customer and the
electric utility shall meet, in person or telephonically, at least once to
discuss the results of the initial analysis on the 10-percent contract
performed by the Regulatory Operations Staff and, if necessary, to exchange
information, including, without limitation, the exchange of any suggested
additions, modifications or deletions to the initial analysis performed by the
Regulatory Operations Staff. The Bureau of Consumer Protection and the provider
must be notified of each such meeting, and each may participate fully in each
such meeting and in any exchange of information.

3. Not later than 30 calendar days after the
date on which the eligible customer files the completed and fully executed
underlying contract, the Regulatory Operations Staff shall:

(a) Finalize its analysis of the 10-percent
contract identified in the application. In finalizing its analysis, the
Regulatory Operations Staff shall incorporate any information obtained from the
eligible customer, the provider, the electric utility and the Bureau of
Consumer Protection that the Regulatory Operations Staff determines will most
accurately indicate whether the 10-percent contract will be beneficial or
detrimental to the remaining customers of the electric utility.

(b) Release the results of its finalized analysis
to the eligible customer, the provider, the electric utility and the Bureau of
Consumer Protection.

(c) Submit its finalized analysis to the
Commission.

4. Not later than 40 calendar days after the
date on which the eligible customer files the completed and fully executed
underlying contract, the electric utility, Bureau of Consumer Protection,
eligible customer or provider may file with the Commission an alternative
analysis to the analysis performed by the Regulatory Operations Staff. Each
alternative analysis must:

(a) Identify the bases for concluding that the
analysis performed by the Regulatory Operations Staff is deficient; and

(b) Include objective information demonstrating
that the methodology used by the party is valid under the range of
circumstances included in the alternative analysis performed by the party.

5. After evaluating the analysis performed
by the Regulatory Operations Staff and any alternative analysis filed pursuant
to subsection 4, the Commission will determine whether it is in the best
interest of the remaining customers of the electric utility to have the
eligible customer assign the 10-percent contract to the electric utility.

6. If the Commission determines that it is
in the best interest of the remaining customers of the electric utility to have
the eligible customer assign the 10-percent contract to the electric utility:

(a) The eligible
customer shall assign the 10-percent contract to the electric utility.

(b) The electric utility shall accept the
assignment and, upon the effective date of the 10-percent contract, include the
10-percent contract in its portfolio to supply its remaining customers. The
10-percent contract:

(1) Shall be deemed to be prudent;

(2) Is not subject to the provisions of NAC 704.9005 to 704.9525, inclusive, for the purposes of
including the 10-percent contract as an option for supply; and

(3) Is not an amendment to the action plan of
the electric utility for the purposes of NAC
704.9503, and the electric utility shall not apply for permission to amend
its action plan pursuant to that section with regard to the 10-percent
contract.

(c) In its subsequent filing for recovery of the
cost of the 10-percent contract, the electric utility shall, to the extent
possible, assign the cost of the 10-percent contract to those classes of
customers who are not eligible for choice pursuant to this chapter, with the
preference to be given to residential customers.

7. If the Commission determines that it is
not in the best interest of the remaining customers of the electric utility to
have the eligible customer assign the 10-percent contract to the electric
utility, the eligible customer is entitled to the 10-percent contract.

NAC 704B.370Duty to file and serve certain agreements; limited review and use
of certain underlying contracts; confidentiality; terms, conditions and
compliance items; petition to reopen consideration of application; limitations
on actions of Commission after approval of application. (NRS 704B.200)

1. Except as otherwise provided in this
section, not later than 40 calendar days after the date on which the eligible
customer files an application, the eligible customer shall file with the
Commission the following agreements:

(a) A completed and fully executed distribution
service agreement between the eligible customer and the electric utility. The
distribution service agreement must include, without limitation:

(1) A list of each point of delivery at which
the eligible customer intends to purchase energy from the provider and, for
each such point of delivery:

(I) The physical location of the point of
delivery; and

(II) The current account number for the
point of delivery, the name on each such account and the current billing
address and final billing address for each such account; and

(2) A detailed plan for the avoidance of
involuntary curtailments of energy or capacity to the remaining retail
customers of the electric utility in the event that:

(I) The eligible customer is unable to
secure supply for 100 percent of its load;

(II) The eligible customer is no longer
being served by operating reserves; and

(III) The electric utility in good faith
determines that it is unable to provide replacement resources to the eligible
customer without negatively impacting system reliability.

Ê The detailed
plan may include provisions for standby service, load shedding, recourse to
reliably available market resources and any other measures or combination of
measures reasonably designed to avoid involuntary load curtailments by the
electric utility.

(b) A completed and fully executed transmission
service agreement and operating agreement with the electric utility meeting all
requirements of its OATT.

2. If the eligible customer does not file
the agreements pursuant to subsection 1 and the Commission approves the
application, the Commission will condition its order approving the application
on the filing of the agreements with the Commission.

3. Each agreement filed with the Commission
pursuant to subsection 1 or 2 must be served on each party of record.

4. If the Commission approves an application
of an eligible customer which is not subject to subsection 2 of NRS 704B.320 and the eligible
customer has not submitted a copy of a completed and fully executed underlying
contract between the eligible customer and the provider for the purchase of
energy, capacity or ancillary services from the provider, the Commission will
condition its order approving the application on submission to the Regulatory
Operations Staff of one copy of such a completed and fully executed underlying
contract between the eligible customer and the provider. Upon receipt of the
underlying contract, the Regulatory Operations Staff shall:

(a) Review the underlying contract to verify that
the terms of the underlying contract are the same as the terms that the
eligible customer provided to the Regulatory Operations Staff when the
Regulatory Operations Staff performed its final analysis of the proposed
transaction; and

(b) Inform the Commission and each party of record
whether the terms are the same or whether the terms differ. If the terms
differ, the Commission will issue an order identifying the terms that differ
and providing the eligible customer with an opportunity to resolve the
differences. If the eligible customer fails to resolve the differences within 7
days, the application shall be deemed to be rescinded.

Ê An underlying
contract that is submitted to the Regulatory Operations Staff pursuant to this
subsection shall be deemed to be submitted for verification purposes only and
must not be included as part of the record of the case. The contents of the
underlying contract shall be deemed to be commercially sensitive and must not
be disclosed on the public record or otherwise in any proceeding governed by
this chapter. The Regulatory Operations Staff shall protect the confidentiality
of the underlying contract and shall not disclose the contents of the
underlying contract to any person or entity, unless authorized by the
Commission.

5. If the Commission approves the
application of an eligible customer which is subject to subsection 2 of NRS 704B.320 and the eligible
customer has not submitted a copy of a completed and fully executed underlying
contact between the eligible customer and the provider for the purchase of
energy, capacity or ancillary services from the provider, the Commission will
condition its order approving the application on submission of a copy of the
completed and fully executed underlying contract to the Commission, the
Regulatory Operations Staff, the Bureau of Consumer Protection and the electric
utility. Upon receipt of the underlying contract, the Regulatory Operations
Staff shall:

(a) Review the underlying contract to verify that
the terms of the underlying contract are the same as the terms that the
eligible customer provided to the Regulatory Operations Staff when the
Regulatory Operations Staff performed its final analysis of the proposed
transaction; and

(b) Inform the Commission and each party of record
whether the terms are the same or whether the terms differ. If the terms
differ, the Commission will issue an order identifying the terms that differ
and providing the eligible customer with an opportunity to resolve the
differences. If the eligible customer fails to resolve the differences within 7
days, the application shall be deemed to be rescinded.

Ê Except for
the review process performed by the Regulatory Operations Staff pursuant to
this subsection to verify the terms of the underlying contract, the underlying
contract may be used only to evaluate the 10-percent contract required pursuant
to NRS 704B.320 and is subject
to any protective order issued pursuant to paragraph (b) of subsection 2 of NAC 704B.340.

6. In addition to the terms, conditions and
compliance items required by subsections 2, 4 and 5, the Commission may
condition its order approving an application with any other terms, conditions
and compliance items it deems necessary to ensure that the proposed transaction
is not contrary to the public interest.

7. The Commission will provide in each order
approving an application that the eligible customer must comply with all terms,
conditions and compliance items imposed pursuant to this section not later than
120 calendar days after the date on which the Commission issues the order.

8. A party of record may petition the
Commission to reopen consideration of an application. A party of record must
file such a petition not later than 15 calendar days after the date on which
the Commission determines that the eligible customer has complied with all
terms, conditions and compliance items imposed pursuant to this section.

9. Except upon a petition to reopen
consideration of an application that is filed by a party of record pursuant to
this section and except as otherwise provided in this section and NRS 704B.360, or as may be needed
to address any objections raised pursuant to NAC
704B.405, the Commission will not, after it issues an order approving an
application:

(a) Rescind or amend its approval of the
application; or

(b) Add to or modify the terms, conditions and
compliance items set forth in the order approving the application.

(Added to NAC by Pub. Utilities Comm’n by R125-01, eff.
12-17-2001; A by R018-04, 11-17-2005)

NAC 704B.380Proposed transaction between eligible customer and provider which
relies exclusively on new electric resources currently in operation. (NRS 704B.200)

1. If a proposed transaction between an
eligible customer and a provider relies exclusively on new electric resources
currently in operation:

(a) Not later than 20 calendar days after the date
on which the Commission determines that the eligible customer has complied with
all terms, conditions and compliance items imposed pursuant to NAC 704B.370, the eligible customer shall notify the
electric utility and the Commission in writing as to whether the eligible
customer intends to proceed with the proposed transaction and, if so, the date
of commencement.

(b) The date of commencement must not be sooner than:

(1) Sixty calendar days after the date on
which the eligible customer notifies the electric utility pursuant to this
subsection; and

(2) One hundred eighty calendar days after the
date on which the eligible customer files the application,

Ê unless the
Commission authorizes an earlier date of commencement.

2. If the eligible customer notifies the
electric utility and the Commission in writing that the eligible customer
intends to proceed with the proposed transaction not later than 30 days after
the Commission issues a compliance order approving the application of the
eligible customer, the impact fee approved by the Commission will not be
updated or adjusted unless the actual date of commencement occurs before the
estimated date of commencement.

3. If the eligible customer notifies the
electric utility and the Commission in writing pursuant to subsection 2, or
reconfirms to the electric utility and the Commission in writing pursuant to
subsection 5, that the eligible customer intends to proceed with the proposed
transaction:

(a) The electric utility:

(1) May plan to discontinue procuring for the
eligible customer the energy, capacity and ancillary services that the eligible
customer will be purchasing from the provider pursuant to the proposed transaction;
and

(2) Shall install or implement, or cause to be
installed or implemented, all systems, operations, equipment and other
modifications necessary to accommodate the proposed transaction.

(b) Except as otherwise provided in subsection 2,
not later than 15 calendar days after the date on which the eligible customer
files its estimated date of commencement pursuant to subsection 1, the
Regulatory Operations Staff shall update its calculation of the impact fee that
will be assessed by the Commission against the eligible customer. The updated
calculation must:

(1) Be based on the estimated date of
commencement; and

(2) Have sufficient detail so that if the
actual date of commencement occurs before the estimated date of commencement,
the impact fee can be adjusted accordingly.

4. Upon completion of the updated
calculation of the impact fee required by paragraph (b) of subsection 3, the
Regulatory Operations Staff shall provide the eligible customer with an
analysis of the updated calculation and, on that date, shall provide a copy of
the analysis to the provider, the electric utility, the Bureau of Consumer
Protection, the Commission and all other parties of record. The analysis must
include a listing of the major assumptions used and a listing of any inputs
that were changed from the original analysis that served as the basis for the
determination by the Commission that the assessment of the impact fee was
necessary so that the proposed transaction would not be contrary to the public
interest. A party of record may file an objection with the Commission to the
analysis of the updated calculation of the impact fee not later than 15
calendar days after the Regulatory Operations Staff provides that analysis to
the party of record pursuant to this subsection. The objection must identify
the basis for concluding that the analysis was deficient, including, without
limitation, an identification of each contested assumption and input.

5. Not later than 30 calendar days after
receiving a copy of the analysis of the updated calculation of the impact fee
pursuant to subsection 4, the eligible customer shall:

(a) If no objections to the updated calculation of
the impact fee are filed pursuant to subsection 4:

(1) Reconfirm to the Commission, electric
utility and parties of record in writing that the eligible customer intends to
proceed with the proposed transaction; or

(2) Inform the Commission, electric utility
and parties of record in writing that the eligible customer will not proceed
with the proposed transaction.

(b) If objections to the updated calculation of the
impact fee are filed pursuant to subsection 4:

(1) Reconfirm to the Commission, electric
utility and parties of record in writing that the eligible customer intends to
proceed with the proposed transaction;

(2) Inform the Commission, electric utility
and parties of record in writing that the eligible customer will not proceed
with the proposed transaction; or

(3) Inform the Commission, electric utility
and parties of record in writing that the eligible customer will defer the
decision of whether to proceed with the proposed transaction until the
Commission issues its decision on the objections. Not later than 30 calendar
days after the date on which the Commission issues its decision on the
objections, the eligible customer shall:

(I) Reconfirm to the Commission, electric
utility and parties of record in writing that the eligible customer intends to
proceed with the proposed transaction; or

(II) Inform the Commission, eligible
customer and parties of record in writing that the eligible customer will not
proceed with the proposed transaction.

6. If the actual date of commencement occurs
after the date of commencement provided to the electric utility in the final
notice of intent to proceed pursuant to this section, the electric utility may
require the eligible customer, or the eligible customer may elect, to begin
taking electric service under the provisions of the incremental pricing tariff
of the electric utility.

7. Notwithstanding the provisions of
subsection 1 of this section and subsection 8 of NAC
704B.370, if the Commission determines that all terms, conditions and
compliance items imposed pursuant to NAC 704B.370
have been satisfied more than 120 calendar days after the date on which the
Commission issues its order approving the application, the Commission may
adjust the period in which the eligible customer must notify the utility of its
intent to proceed with the proposed transaction and the date of commencement.

(Added to NAC by Pub. Utilities Comm’n by R125-01, eff.
12-17-2001; A by R018-04, 11-17-2005)

NAC 704B.385Proposed transaction between eligible customer and provider which
relies on new electric resources that will be constructed after application
granted by Commission. (NRS 704B.200)

1. If a proposed transaction between an
eligible customer and a provider relies on new electric resources that will be
constructed after the Commission has issued its order granting the application:

(a) The Commission will establish reasonable time
intervals by which:

(1) The eligible customer must file, and the
electric utility must process, documents required to determine if the eligible
customer is in compliance with all the terms, conditions and compliance items
imposed pursuant to NAC 704B.370; and

(2) The Regulatory Operations Staff must
review and verify whether the eligible customer has complied with the order
issued by the Commission.

(b) Not later than 20 calendar days after the date
on which the Commission determines that the eligible customer has complied with
all the terms, conditions and compliance items imposed pursuant to NAC 704B.370, the eligible customer shall notify the
electric utility and the Commission in writing as to whether the eligible
customer intends to proceed with the proposed transaction and, if so, the
estimated date of commencement.

2. If the eligible customer notifies the
electric utility and the Commission pursuant to subsection 3, or reconfirms to
the electric utility and the Commission pursuant to subsection 6, that the
eligible customer intends to proceed with the proposed transaction, the
electric utility:

(a) May plan to discontinue procuring for the eligible
customer the energy, capacity and ancillary services that the eligible customer
will be purchasing from the provider pursuant to the proposed transaction; and

(b) Shall install or implement, or cause to be
installed or implemented, all systems, operations, equipment and other
modifications necessary to accommodate the proposed transaction.

3. If the eligible customer notifies the
electric utility and the Commission in writing that the eligible customer
intends to proceed with the proposed transaction not later than 50 days after
the Commission issues a compliance order approving the application of the
eligible customer, the impact fee approved by the Commission will not be
updated or adjusted unless the actual date of commencement occurs before the
estimated date of commencement.

4. Except as otherwise provided in
subsection 3, not later than 15 calendar days after the date on which the
eligible customer notifies the electric utility and the Commission of its
estimated date of commencement pursuant to paragraph (b) of subsection 1, the
Regulatory Operations Staff shall update its calculation of the impact fee that
will be assessed by the Commission against the eligible customer. The updated
calculation must:

(a) Be based on the estimated date of commencement;
and

(b) Have sufficient detail so that if the actual
date of commencement occurs before the estimated date of commencement, the
impact fee can be adjusted accordingly.

5. Upon completion of the updated
calculation of the impact fee required by subsection 4, the Regulatory
Operations Staff shall provide the eligible customer with an analysis of the
updated calculation and, on that date, shall provide a copy of the analysis to
the provider, the electric utility, the Bureau of Consumer Protection, the
Commission and all other parties of record. The analysis must include a listing
of the major assumptions used and a listing of any inputs that were changed
from the original analysis that served as the basis for the determination by
the Commission that the assessment of the impact fee was necessary so that the
proposed transaction would not be contrary to the public interest. A party of
record may file with the Commission an objection to the analysis of the updated
calculation of the impact fee not later than 15 calendar days after the
Regulatory Operations Staff provides that analysis to the party of record
pursuant to this subsection. The objection must identify the basis for
concluding that the analysis was deficient, including, without limitation, the
identification of each contested assumption and input.

6. Not later than 30 calendar days after
receiving a copy of the analysis of the updated calculation of the impact fee
pursuant to subsection 5, the eligible customer shall:

(a) If no objections to the updated calculation of
the impact fee are filed pursuant to subsection 5:

(1) Reconfirm to the Commission, electric
utility and parties of record in writing that the eligible customer intends to
proceed with the proposed transaction; or

(2) Inform the Commission, electric utility
and parties of record in writing that the eligible customer will not proceed
with the proposed transaction.

(b) If objections to the updated calculation of the
impact fee are filed pursuant to subsection 5:

(1) Reconfirm to the Commission, electric
utility and parties of record in writing that the eligible customer intends to
proceed with the proposed transaction;

(2) Inform the Commission, electric utility
and parties of record in writing that the eligible customer will not proceed
with the proposed transaction; or

(3) Inform the Commission, electric utility
and parties of record in writing that the eligible customer will defer the
decision of whether to proceed with the proposed transaction until the
Commission issues its decision on the objections. Not later than 30 calendar
days after the date on which the Commission issues its decision on the
objections, the eligible customer shall:

(I) Reconfirm to the Commission, electric
utility and parties of record in writing that the eligible customer intends to
proceed with the proposed transaction; or

(II) Inform the Commission, electric
utility and parties of record in writing that the eligible customer will not
proceed with the proposed transaction.

7. An eligible customer must comply with all
terms, conditions and compliance items imposed pursuant to NAC 704B.370 not later than 70 days before the
estimated date of commencement. Upon the request of the eligible customer, the
Commission may approve a revised estimated date of commencement.

8. If, as of the estimated date of
commencement:

(a) The eligible customer is not capable of
receiving energy, capacity or ancillary services from the provider of new
electric resources pursuant to the proposed transaction; and

(b) The eligible customer is otherwise eligible to
take electric service under the electric utility’s incremental pricing tariff
for the electric utility,

Ê the electric
utility may require the eligible customer, or the eligible customer may elect,
to take electric service under the incremental pricing tariff of the electric
utility until the actual date of commencement.

1. If the Commission approves an
application, the Commission will order the eligible customer to pay its actual
load-share portion of any unrecovered positive balance in the deferred accounts
of the electric utility existing as of the date of commencement. The amount to
be paid by the eligible customer must be calculated by the electric utility and
approved by the Commission.

2. Not later than 7 calendar days after
receiving notification pursuant to subsection 1 of NAC
704B.380 or subsection 1 of NAC 704B.385 that
the eligible customer intends to proceed with the proposed transaction, the
electric utility shall provide the eligible customer and the Commission with:

(a) An estimate of the amount to be paid by or
refunded to the eligible customer based upon estimates by the electric utility
of the load-share portion of the eligible customer and of the balances that
will be in the deferred accounts of the electric utility as of the date of
commencement; and

(b) All supporting data and calculations.

3. The estimated amount that is calculated
pursuant to subsection 2 must be paid by or refunded to the eligible customer,
as appropriate, in a manner agreed to by the eligible customer and the electric
utility. Except as otherwise provided in the underlying contract between the
eligible customer and the electric utility, the payments or refunds must be
made in monthly installments for the remainder of the deferral period.

4. After the estimated amount is calculated
pursuant to subsection 2, the electric utility, in its most immediately
following application to clear its deferred accounts pursuant to NRS 704.110, shall establish the
actual amount that should have been paid by or refunded to the eligible
customer. After the actual amount has been established by the electric utility
and approved by the Commission with any necessary adjustments, the difference
between the estimated amount and the actual amount must be paid by or refunded
to the eligible customer, as appropriate.

5. As used in
this section, “actual load-share portion” means the proportion determined from
the ratio of the annual energy load of the eligible customer (numerator) to the
total annual retail energy load of the electric utility (denominator).

(Added to NAC by Pub. Utilities Comm’n by R125-01, eff.
12-17-2001; A by R018-04, 11-17-2005)

1. If an eligible customer that is
purchasing energy, capacity or ancillary services from a provider intends to
purchase the energy, capacity or ancillary services from an alternative
provider pursuant to a proposed transaction in which the terms or conditions,
other than price, do not conform with the terms and conditions originally
approved by the Commission with respect to the eligible customer, the eligible
customer shall submit its proposed transaction with the alternative provider to
the Commission for approval pursuant to the provisions of this section.

2. To obtain approval of a proposed
transaction between an eligible customer and alternative provider described in
subsection 1, the eligible customer must give to the Commission and each party
of record to the docketed matter in which the eligible customer’s underlying
contract was approved, notice of the eligible customer’s intention to purchase energy,
capacity or ancillary services from the alternative provider. The notice must:

(a) Be in writing;

(b) Contain the information relating to the supply
of energy, capacity or ancillary services required for an application pursuant
to NAC 704B.340; and

(c) Clearly identify each term and condition that
the eligible customer believes does not conform to the terms and conditions of
the underlying contract originally approved by the Commission.

3. In addition to the notice required by
subsection 2, the eligible customer shall provide to the Regulatory Operations
Staff a copy of the underlying contract previously approved by the Commission
pursuant to which the eligible customer was purchasing energy, capacity or
ancillary services from a provider of new electric resources and a copy of the
contract for the proposed transaction between the eligible customer and the
alternative provider. Contracts that are submitted to the Regulatory Operations
Staff pursuant to this subsection are deemed to be submitted for verification
purposes only, and will not be considered to be part of any public record. The
Regulatory Operations Staff shall protect the confidentiality of such contracts
and shall not disclose the contents of those contracts to any person or entity,
unless authorized by the Commission.

4. An eligible customer may request from the
Commission a protective order to protect the confidentiality of any information
relating to the proposed transaction between the eligible customer and the
alternative provider that the eligible customer believes to be commercially
sensitive. The Commission will determine whether the requested information is
commercially sensitive and requires confidential treatment under Nevada law.

5. Within 12 working days after receiving
notice pursuant to subsection 2:

(a) A party of record may file any objection to the
proposed transaction with the Commission and forward a copy of the objection to
the eligible customer, alternative provider and all other parties of record.
Such an objection must clearly describe the basis for the objection.

(b) The Regulatory Operations Staff shall:

(1) If the Regulatory Operations Staff objects
to the proposed transaction, notify the Commission, eligible customer,
alternative provider and the parties of record of its objection and identify
the terms and conditions of the proposed transaction that the Regulatory
Operations Staff believes do not conform with the terms and conditions of the
underlying contract; or

(2) If the Regulatory Operations Staff does
not object to the proposed transaction, the Regulatory Operations Staff shall
notify the Commission, eligible customer, alternative provider and all other
parties of record of that fact.

6. The Commission will process the notice on
an expedited basis. If no objections are timely filed pursuant to subsection 5,
the proposed transaction shall be deemed to be approved by the Commission. If
any party or the Regulatory Operations Staff files an objection to the proposed
transaction, the Commission will set the matter for a hearing to be held within
15 working days after the last date on which objections may be filed. The
eligible customer shall file any response to the objection within 4 working
days after receiving the objection. The Commission will approve the proposed
transaction unless the Commission determines that the proposed transaction is
inconsistent with the requirements of this chapter and chapter 704B of NRS regarding the terms
and conditions of transactions between eligible customers and providers of new
electric resources. If the Commission makes such a determination, the
Commission will identify the inconsistent terms and provide the eligible
customer with an opportunity to revise the terms of the proposed transaction to
resolve the inconsistencies. If the eligible customer fails to resolve the
inconsistencies, the Commission may prohibit the proposed transaction.

7. If applicable, the analysis of the
10-percent contract must be performed pursuant to NAC
704B.360, except that the Commission will process the analysis on an
expedited basis commencing upon the approval by the Commission of the proposed
transaction between the eligible customer and the alternative provider. A
10-percent contract must be submitted to the Commission for review upon the
replacement or amendment of every underlying contract.

8. Notwithstanding any provision of this
chapter to the contrary, the Regulatory Operations Staff may use the underlying
contract between an eligible customer and provider to evaluate an application
for a proposed transaction between the eligible customer and alternative
provider filed by the eligible customer pursuant to this section.

(Added to NAC by Pub. Utilities Comm’n by R018-04, eff.
11-17-2005)

NAC 704B.410Criteria for determining whether proposed transaction will be
contrary to public interest. (NRS 704B.200, 704B.310)In
determining whether a proposed transaction for an existing eligible customer
will be contrary to the public interest:

1. The Commission will base its
determination on the criteria set forth in subsections 5 and 6 of NRS 704B.310. To approve the
application, the Commission must determine that the proposed transaction does
not subject the electric utility or its remaining customers to increased costs
as a result of the proposed transaction.

2. In addition to the criteria set forth in
subsection 1, the Commission may consider, without limitation, and give due
weight to:

(a) The potential impacts of the proposed
transaction on the electric utility and its remaining customers as set forth in
the analysis performed by the Regulatory Operations Staff pursuant to NAC 704B.350.

(b) The potential impacts of the proposed
transaction on the electric utility and its remaining customers as set forth in
any alternative analysis filed by a party of record pursuant to NAC 704B.350.

(c) The potential impacts of the proposed
transaction on the electric utility and its remaining customers which are of a
qualitative nature or of a quantitative nature and which were not included in
the analysis performed by the Regulatory Operations Staff pursuant to NAC 704B.350.

(d) The opportunity or ability of the electric
utility to mitigate costs that would otherwise be assigned to its remaining
customers, provided that any such mitigation must not alter, diminish or
otherwise affect any rights or obligations arising under any contract which
requires the electric utility to purchase energy, capacity or ancillary
services from another party and which was in existence on July 17, 2001.

(e) The extent to which the proposed transaction
increases or decreases existing subsidies to the remaining customers of the
electric utility in the same rate class or in other rate classes.

(f) Factors that affect system reliability of the
electric utility, including, without limitation, whether approval of the
application will result in:

(1) Construction of additional generation,
transmission or distribution assets without cost to the remaining customers of
the electric utility;

(2) Location of generation assets where they
may improve or degrade system reliability; and

(3) Availability of generation assets which
may be dispatched by the electric utility or which may be capable of providing
ancillary services such as regulation.

(g) Factors that affect the general welfare of the
residents and communities of this State, including, without limitation,
employment, economic development and the quality of life.